Victor Muller, CEO of both Saab and Swedish Automobile, said in a statement: “We have concluded that a voluntary reorganization process will provide us with the necessary time, protection and stabilization of the business, allowing salary payments to be made, short-term funding to be obtained and an orderly restart of production to be prepared.”
Sad. They lost more money last quarter than they took in, a REALLY bad sign. I can’t imagine how they’ll survive.
This is sad, I’ve been a fan of Saab since the mid '60’s. A roommate had a 2 cycle 3 banger that was fun, quirky, and a great snow car. The Sonnet was always cool. The Saab 99 was a very good car that grew into the 900 models. The 900’s of the early to mid '80’s could have been some of the most reliable and bullet proof cars ever. The 4 cylinder turbo motors of the 900’s were simply great motors. GM just blew it and now Saab is on its last legs.
The only chance Saab has is a return to its roots. Just design, build, and sell a truly unique small car. If they could get one more small car to be a hit seller they could make a comeback. Kill all the remnants of GM thinking, forget about lots of models for all market segments. Just build one really good, fun, high mpg, car and go from there. Forget being a luxury car maker, that category is too competitive. People still don’t have enough choices in basic, inexpensive cars. A reliable car for $15K might sell even if it had crank windows. Good seats, strong safe frame, peppy motor, stick shift, seating for 4 with a decent sized trunk. Nothing bigger than a Corolla or Civic, or perhaps a tad smaller.
It’s extremely difficult for a manufacturing organization to recover from Chapter 11, which is what they’re proposing. In a healty company one plans the production schedule, orders parts, take delivery some time later, then pays the vendor in 30/60/90 days (depending on the PO). In order to get a Chapter 11 court approved, the company has to get its majjor vendors to accept an “amount on the dollar”…a loss on money owed. Vendors will do that because the option is to perhaps get less or nothing.
But, those weeks and months between a parts order and payment for the parts is almost llike a free operating loan, an operating capital “window”. It can help coordinate money out with revenue in. Once a company files Chapter 11, its vendors will require payment up-front before beginnning to produce parts…and its prices will rise. That “window” disappears completely, and the true production time increases dramatically because the vedor don;t start on the parts intil payment is made. And for a Chapter 11 company to get an operating capital loan to “fill the gap” is almost impossible. Unless SAAB can come up with enough operating capital to fill that void, or hold out until they’re bought out, they’re doomed.
In addition, who here would tell a family member/friend to go out and buy a Saab, even if they emerge from Chapter 11? I know I won’t. The reputation hit will be huge.
Saab has been doomed before and maybe, if they do another temporary shift back to boats or planes, they will weather this storm and come up with a few more beauties like the ole 900. Can’t believe mine’s 20 years old and still runs without any hiccups. Mind you, I might have to go stock up on some parts while I still can…
This was in April: http://www.economist.com/node/18529855, looks like there won’t be a phoenix for a while yet…after this, there aren’t many other choices out there for future design awards.
very sad indeed.
I owned 3 Saabs; an '85 900 normal aspirated 5 spd stick, a 900T turbo 5 spd stick that were both 3 door hatchbacks and a 2000 93 that was a 5 door hatchback automatic. The 2000 was during GM’s ownership and wasn’t nearly the solid car the 900’s had been and they just got worse after 2000. Of course GM had to use their V6 motors and transmissions which were crap compared to the Saab 4 cylinder which helped ruin the Saab car’s distinct character. There really is a unique sound to the Saab 4 cylinder turbo exhaust sound.
I was kind of wishing once rid of GM Saab could find a way to survive; not likely now.
A few months ago, I saw a new Saab 9-5 on display at a shopping mall.
Since all of the Saab dealers in my area closed their doors a while back, I decided to take a close look at this display model. While it was an okay-looking car, it was certainly nothing spectacular to look at, nor did it have any special or unique type of equipment.
Then, I looked at the Monroney sticker on the window and was totally shocked.
With a few options, this Saab was stickered at something like $52,000!
When you consider that…
This car is essentially just a cross between a Buick LaCrosse and a Buick Regal, with some mechanical tweaking by Saab, plus a different body…
and, this company has one foot in the grave and the other foot on a banana peel…
my reaction to that sticker price was something along the lines of…You’ve got to be freakin’ kidding me!
The Swedish government would not bale out Saab, GM basically abandoned them, and Spyker, the Dutch luxury car maker, had neither the capital nor the mass manufacturing knowhow.
That leaves a well heeled Chinese or Indian firm to pick up the pieces and keep them going.
Let’s hope this happens and the mark stays in business.
VDCdriver has hit the real issue with Saab. GM tryed to make this into another luxury brand with high profit margins - and it didn’t work. The original Saabs were just good cars, not luxury models but more basic with a “sporty” feel. High priced Saabs were a dog in the luxury market.
Saab finally makes a great looking car, sales are up (my last email claimed 96%) but it’s still not enough.
looks like it got rejected
If the Chinese wait, they should be able to buy the assets from the court and leave the liabilities of Saab in the court’s hands. That occurs often with bankruptcies. And the Chinese company that buys Saab can blame the delay on the Chinese bureaucrats.
Chinese carmaker Zhejiang Youngman said it was getting positive signs from authorities in Beijing about its plans to invest in cash-strapped Saab, a Swedish daily paper reported.
A Chinese company (I think) has done a similar thing with MG, basically bought the name, trying to reintroduce the brand. I wonder if Saab will end up a badge on a Chinese-made car.
I suspect that the new owner might want to make cars, but making replacement parts is enough to make money for now. They could reintroduce the Saab as a new car later. I say this because Saab sales have been awful work wide. If you can’t make money building them, why bother?
70M euros from a Chinese company
It’s interesting that two of their unions filed to force bankruptcy, saying that they want to get paid back wages. Every country has their own laws, of course, but I would expect that other creditors are ahead of the workers in their bids for a piece of a defunct Saab. It seems to me that their best bet is to go back to work at Saab if they can start building cars again. If they haven’t moved on to other employment, that is.
JTS, I get the feeling that the unions are following a particular set of steps that frees up their back wages under Swedish law.